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Balloram And Anr. Versus Firm Seth Uttamchand Bishandas.

Dated:- 4-4-1960 - L.N. Chhangani ORDER L.N. Chhangani, 1. This is a plaintiffs' revision against an appellate order of the District Judge, Bharatpur dated 8th September, 1955, dismissing the plaintiff- petitioners' appeal and maintaining the order of the Civil Judge, Bharatpur dated 22nd November, 1954 returning the plaint for presentation to the proper court. 2. The facts of the case broadly stated are as follows:- 3. The plaintiff-petitioners, Balloram and Veryamal claim to be the pro .....

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fendants' firm as their commission agents for the purchase of jaggery in November-December, 1946 and in that connection, paid various sums of money to the defendant firm either in Pakistan or at Meerut. According to the plaintiffs, it was agreed that the defendants would render accounts and arrange payment of the balance that may be found due to the plaintiffs at Sibi in Pakistan. On Asad 18, samwat 2004 corresponding to 8th August, 1947, the defendant firm sent an account to the plaintiffs& .....

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ggery and would require the amount in that connection. Subsequently, in consequence of partition, the plaintiffs had to leave Pakistan and come over to India and, therefore, they could not utilize the amount for the purchase of jaggery and the amount remained in deposit with the defendant firm carrying interest at the rate of 6 per cent per annum. The plaintiffs alleged having received ₹ 3,000/-on different dates and claimed that the amount of ₹ 2,825/- remained due. The plaintiffs&# .....

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of the Civil Judge, Bharatpur on 1st July, 1950. 3. The defendants resisted the plaintiffs' suit and, inter alia, pleaded that the court of the Civil Judge at Bharatpur had no jurisdiction to entertain the suit. They denied the agreement set up by the plaintiffs for rendering accounts and paying dues at Sibi and further pleaded that the cause of action did not arise either in whole or in part in any area now forming part of Pakistan. The parties are agreed that in case of the cause of actio .....

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of the plaint. It will he useful to give here the various grounds on which the plaintiffs attempted to give jurisdiction to the court at Bharatpur and the findings of the Civil Judge on those grounds :- 7. In the first instance, it was urged that the return of the Hundis from Sibi by the plaintiffs with a direction that the amount sought to be paid through Hundis might be kept at Meerut, amounted to the making of an offer to the defendants and, therefore, the cause of action partly arose at Sibi .....

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ndly, the plaintiffs relied upon a special agreement to the effect that the accounts would be rendered at Sibi and the balance would be paid there. The trial Judge rejected this ground by a two-fold argument: (a) that the deposit of the amount with the defendants had nothing to do with the agency business and should be treated as a separate transaction, and (b) that the fact of agreement cannot be accepted, particularly in view of a condition entered in Ex. P-1 on which the suit was based, readi .....

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findings of the trial Judge and dismissed the appeal. The plaintiffs have consequently filed this revision. 12. The ground based upon a special agreement cannot be pressed in this revision, as it involves a pure question of fact. The findings of the courts below must be taken as binding and cannot be allowed to be agitated in revision, 13. The other contention with regard to the part of a cause of action having arisen at Sibi on account of the offer having been made from that place is also with .....

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re is no relationship of creditor and debtor between the parties is perverse and is in clear disregard of the elementary principles of law on the point and the courts below, therefore, went completely wrong in omitting to apply the common law rule, "the debtor must find the creditor". It was argued in this connection that the amount was in the first instance deposited with the defendant firm to be utilized by the plaintiffs for the purchase of jaggery, but when it became impossible for .....

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l and considering the facts of the case, I am inclined to hold that in connection with the deposit of the amount, the relations between the parties were certainly that of a debtor and creditor. Evidently, in the present case, there was no bailment of currency in specie to be returned as such. The payment to the plaintiffs was sought to be made through Hundis which were not encashed and were returned. Neither the currency in specie was offered to the plaintiffs, nor was it returned to be kept in .....

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ule about the place of performance of contracts has been stated in the Halsbury's Laws of England, Third Edition, Volume 8, para 288 as follows:- "Where no place for performance is specified either expressly or by implication from the nature and terms of the contract and the surrounding circumstances, and the act is one which requires the presence of both parties for completion, the general rule is that the promisor must seek out the promisee and perform the contract wherever he may hap .....

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creditor has no application to wages payable by employers of labour who have a regular pay day and a regular office for making payment." 18. The implication clearly is that unless the contract or the circumstances in which the contract was made give rise to a contrary implication, a creditor is competent to sue in any court within the local jurisdiction of which he happens to be, when his right to sue arises. In other words, the creditor's residence at the time of the commencement of t .....

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animous. The Judges have differed as to the circums tances under which the Rule should be applied as also to the purposes for which it can be applied. It will be desirable to notice first of all, the High authority of the Privy Council in Soniram Jeetmull v. R. D. Tata and Co., AIR 1927 PC 156. Before that decision, there were conflicting decisions, some applying the Rule and some not applying the Rule. In that case, the defendants had contracted under a memorandum executed and signed at Calcutt .....

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and it follows that they must pay where that firm is." His Lordship then concluded that, upon the face of this contract, not indeed in express terms, but by the clearest implication, payment is to be made in Rangoon. The argument that this constitued an importation of a technical rule of the English common law into the Jurisprudence of India was disposed of by an observation that, "the simple answer to that would have been that, on the contrary, it was a mere implication of the meanin .....

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d from this decsion will be taken up a little later, but it must be safely said that the Privy Council recognised the applicability of the Rule and earlier decisions of the High Courts that the Rule cannot be applied in India, cannot be considered as laying down the correct law. 20. Mr. Joshi contended that the Privy Council case has been interpreted not to imply that the rule should be invoked for the purpose of determining the forum. He has relied upon the following cases: The first case is Au .....

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ased upon the inferences drawn from the terms of the impact itself or from the necessities of the case. It may be noted that their Lordships of the Privy Council drew from the fact that the defendants were to pay to the plaintiff, a conclusion as a matter of course that they must pay where the firm as. There is not the slightest indication that their Lordships had any thing like the terms of the contact or the circumstances of the contract in their mind in arriving at the decision except that th .....

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e of the agreement should be taken impliedlyas the place for the payment of the debt. If the creditor's place of residence at the time of agreement should be presumed to be the place of the payment in the absence of a contract to the contrary, then it follows as a necessary corollary that the creditor's residence does affect the determination of the forum. 21. Another case relied upon by the learned counse1 for the non-petitioners is Ramalmga Iyer v. Jayalakshmi, AIR 1941 Mad 695, Leach .....

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I have no objection to its being so used and that is the way in which the Judicial Committee used it in ILR 5 Rang 451 : (AIR 1927 PC 150), but if it is argued that in every case of debtor and creditor, the rule is to be applied without considering either the terms of the contract or the circumstances attending on it or the necessities of the case, I have no hesitation In rejecting the contention. The question whether the common law rule of England is to be applied to a country of vast distances .....

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unjab cases, Piyarasing v. Bhagwadas, AIR 1951 Punj 33, Niranjansingh v. Jagjitsingh, (S) AIR 1955 Punj 128, Premnath v. Kaudoomal Rikhiram, AIR 1958 Punj 361. 24. In AIR 1951 Punj 33 the applicability of the rule was considered in respect of a promissory note, which according to the learned Judges themselves who decided the case, stood on a different basis. Kapur J. of course noticed and discussed several cases on the applicability of the rule to ordinary debts and summed up his conclusions in .....

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ance to be made." 25. The observations of Kapur J. are based upon the observations of Varadachariar J. in AIR 1940 Mad 588, which have already been discussed above. The later Punjab cases (S) AIR 1955 Punj 128 and AIR 1958 Punj 361 merely follow the earlier Punjab case, in AIR 1951 Punj 33. In my opinion, the interpretation of the Privy Council in the earlier Punjab case, in AIR 1951 Punj 33 is not quite accurate, 26. Assuming that the technical common law rule that, the creditor's resi .....

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of the re-payment of the debt, and should determine the forum. There arc several cases, where the rule has been applied in the manner indicated above. See Champaklal v. Nectar Tea Co., AIR 1933 Bom 179, Md. Esuff v. M. Hatcem and Co., AIR 1934 Mad 581 and Shimoga Oil Mills v. Radhakrishna Oil Mills, AIR 1952 Mys 111, cited by Mr. d. P. Gupta appearing for the petitioners. In addition, I noticed two cases, Tulsiman Bibi v. Abdul Latif, AIR 1936 Cal 97 and Bharumal v. Sakhawatmal, AIR 1950 Bom 111 .....

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Creditor and repaying the amount, and the common law rule imposes this obligation only when there is no express contract to the contrary." 27. In my opinion, these two decisions have taken rather the other extreme view and in view of the language of the Privy Council decision in AIR 1927 PC 156, they cannot derive support from It. The Privy Council in that case proceeded to determine the place of payment so as to determine jurisdiction and further termed the rule as technical one. There is .....

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unt to engrafting an exception to Section 20 C. P. C. With respect, I cannot share this opinion. Section 20(c) contemplates that a suit can be filed in a court within whose jurisdiction a part of the cause of action 'arises. The place of performance is one of the important elements in a contract and it is settled law that a cause of action arises also partly at the place of performance. If the rule is applied to treat the creditor's residence as the place of performance and thereby to de .....

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the promise, and to perform it at such place." 31. It only imposes a duty on the promisor to apply to the promisee to appoint a reasonable place for the performance of the promise. 32. I have already referred to the manner in which the Privy Council disposed of the argument based upon Section 49. I may further refer to in this connection the observations of the Privy Council: "It is not easy to reconcile with the ordinary rules of law a Construction which enables the promisor to bette .....

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uncil case and various subsequent decisions and a consideration of the statutory provisions, may be stated as follows :- (1) The technical rule that the creditor's residence at the commencement of the suit should determine the forum in the absence of a contract to the contrary should not be applied in India. India is a vast country and it is hardly fair to impose a burden upon the debtor to seek the creditor whereever he happens to go in this vast country. The Privy Council case, AIR 1927 PC .....

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en though the place has not been fixed at the time of agreement expressaly or impliedly, I but if it has been subsequently fixed under Section 49 of the Contract Act on an application of the promisor and with the consent of the promisee, the rule should not be applied. (4) If it is not possible to establish an agreement respecting the place of performance or payment, express or implied, the court should apply the rule and should presume that the place of the creditor's residence at the time .....

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er factors should be considered along with this rule for determining the place of performance, as the rule implies a clear presumption in the absence of a contract to the contrary. 35. Examining the present case in the light of these principles, the only question that has to be considered is whether there was any agreement between the parties, express or implied, determining the place of payment. If such an agreement is established, the rule will not apply. If such an agreement is not proved, th .....

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